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What are the legal procedures that one has to complete after he has done coding the great idea?

Do you suggest launching an idea upon completion of the project, and see how people react or shall one complete legal procedures before launching it?

Another question related to that, do I have to spend thousands of dollars to hire a lawyer and get legal things done just for a free idea of my own? What is the cheapest ways to do those legal things and what are they?

Thanks in advance.

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Hey Emir -- this is the kind of thing that might vary drastically from country to country, so it would be great if you'd be explicit about where in the world you're based. (You say "dollars" which is a hint that you might be based in the US, but...) – Giles Thomas Jan 7 '11 at 1:28
Say US or Canada for now. – Emir Jan 7 '11 at 2:58

3 Answers

up vote 1 down vote

An idea about how to proceed:

  1. If you have a webbased service, register a domain
  2. Search for legal documents like: Terms of Use, Disclaimer, Privacy Policy and so on. Just take a look what others have. If you take a look to the big players legal information, you could be sure, that they have had a lawyer reviewing it before it is posted.
  3. Launch your Service and see how people react.
  4. If reaction is good, think about a legal entity such as LLP, LLC or what suites your need. It might be necessary to consult a lawyer here, but only in case you have clear questions. So get as much information upfront as possible about your desired form of corporation.

It might be necessary for you to register your business before step 3. Please consult your Chamber of Commerce or any other local authority to know the requirements. In some countries it is possible to register a business up to 6 month after it started operation.

Hope this helps... Good Luck

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up vote 0 down vote

it depends on what you are launching, how you are launching it, and the people you are sharing the project with.

Do you intend to do a private launch to keep the idea from spreading beyond certain boundaries? If so, you'll want to draft a non-disclosure agreement between all parties involved. If not, no worries here. Do you intend to solicit investment? If so, you'll want to form a business entity (typically a corporation or a LLC) and draft shareholders/membership contracts. Actually, if you plan to accept online payments through a payment gateway, you typically need company verification documents in order to open a merchant account. Do you intend to hire employees? If so, you'll need to draft employment contracts and think compensation.

I'd personally register a corporation and start marketing the product with a memorable name (that isn't taken in your field, of course).

No, you don't have to spend thousands of dollars to hire a lawyer. Many of these things you can do yourself. Check out these DIY kits: Here

Nolo also has some good DIY guides.

Disclaimer: This is not legal advice and does not constitute an attorney-client relationship.

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Can you please expand that url to seravia.com/howtos/search I think for such a url a url shortner is pointless and url shorteners in general are frowned upon in stack exchange sites. – Earlz Jan 7 '11 at 4:02
up vote 0 down vote

I'm the co-founder of Foundrs.com, which solves that exact problem. My advice of course would depend on the details of your situation, but if all you have is an idea, try to avoid spending the thousands of dollars in legal fees to start a real company.

You can make 3 mistakes (assuming you have co-founders):

1) not have any deal in place at all and postpone any discussion on equity split until it's too late - bad

2) incorporate on the cheap without proper startup structure (stock vesting and so on) - bad

3) incorporate properly and pay $5,000 for an idea that never goes anywhere -bad

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